Commentary on Australian and world events from a socialist and democratic viewpoint

Doing the time warp

Following up on my post about Rachel Nolan’s arguments for privatisation, I ran across this interview with former ALP education minister and attorney general Cameron Dick, generally regarded as a rising star while Labor was in office. Before Nolan, Dick was the only minister willing to go on record with thoughts about Labor’s defeat and he had this to say

he felt the party should have concentrated more on the economy during the election campaign, emphasising the decisions it had made.

‘‘I do think Labor fell into the error, or seriously miscalculated and under-estimated the desire for Queenslanders to hold onto the AAA credit rating,’’ he said.

‘‘And I think the concern Queenslanders had generally about government debt and deficit.

‘‘And I think we were unable to effectively tell our story about investing in infrastructure to keep jobs.

‘‘I mean, that was the strategy we took as part of the global financial crisis.’’

Say what? All of these points would be a great explanation if Labor had lost the 2009 election, after sacrificing the AAA rating to maintain infrastructure and jobs as a strategy in response to the global financial crisis. But, in reality Labor won that election easily. The plunge in the polls came when they announced a drive to restore the AAA rating by selling public assets, mostly infrastructure, and by pushing the panic button with respect to government debt and deficits. All the polls showed that no one except the pollies (and powerful bureaucrats like Doug McTaggart and Leo Hielscher) gave two hoots about the discredited ratings agencies. They hated the asset sales, and dumped the government as a result.

To strengthen my conclusion from last post, while the Newman government has been a disaster, the Labor MPs who supported the sales to the bitter end (all but a handful) brought their fate on themselves, and deserved it. Labor will certainly win lots of seats next time around, and perhaps even win government. I hope they can do a better job selecting candidates whose views reflect those of Labor voters.

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34 thoughts on “Doing the time warp”

This a fairly superficial analysis of the situation by all.
Simple fact is no one thanks you for keeping you in a job. Many public servants are living this to their regret at the moment.
Not many really have any idea what a triple A credit ratings is and what it means.
Secondly, As far back as the 2010 federal campaign several ALP affiliated unions were running undermining campaigns, including on the asset sales to their disgrace. One union who also had a member on the powerful Qld ALP admin committee included vote Green material in a mail out to union members.
These actions were about preserving their power and membership numbers and certainly not about what was appropriate in response to the GFC or in the best interest of the state.
They were invited several times by Anna Bligh to put an alternative plan but none was forth coming.
Thirdly the federal leadership challenge brought on by self-absorbed Julia Gillard, Wayne Swan, who published one of the most disgraceful letters in living memory about a sitting ALP member and former PM, along with her factional relic supporters highlighted that the ALP was unfit to govern.
They were a party who couldn’t govern themselves and at the time releasing policies that had the potential to hurt people. Normally commentators claim electors are able to distinguish between state and federal matters but this action brought federal concerns sharply into focus during the state campaign. Lets just recall Rudd had popular support, particularly in Queensland, but had little support in caucus.
There is no doubt the factional junta running the federal ALP was deeply concerned about the impact of a surging Rudd having a positive impact on the state campaign versus a struggling Gillard.
Put simply she was gone under those circumstances.
It is clear that this was a calculated and purposive decision taken by her and her factional relic supporters to sacrifice the Queensland ALP.
All this, Swan’s letter, the leadership challenge and the re-buff of a popular leader [Rudd]highlighted the ALP’s colossal self-indulgence.
Fourthly Anna Bligh wanted a long campaign to highlight the shortcomings of her opponent. She didn’t get the long campaign because of the federal mayhem. Newman was under pressure during the campaign.
Fifthly the central campaign failings. They had read too much theory about negative campaigns working. Negative campaigns do if there is a positive alternative as well. They didn’t have a plan B when the CMC cleared Newman on the matters first raised by the online news outlet – BrisbaneTimes.
Sixthly there were a number of economic factors which were also working against incumbent governments – housing prices, lack of sales, etc.
Underpinning all this was a very poor attitude of sitting ALP members towards ordinary ALP members. Many in caucus and the ALP administration took the membership for granted and did little to grow the Labor party and preserve members. Thus we seethe $5 memberships at the moment. This reflects poorly on the standard of caucus members and party administration. And their attitudes towards ordinary ALP members. There was a real lack of quality in the ministry
Cameron Dick reflects how out of touch many of the caucus had become – trusting in polls and focus groups.

@John Mainard Kaynes “Not many really have any idea what a triple A credit ratings is and what it means”
And why should they? It is totally unreasonable to expect an applicant for a public service position to show competency with global macro economics.

If someone doesn’t understand the concept of a triple A credit rating then they are pretty dumb. This of course is no barrier to voting, employment, or membership of a political party!
But it is pretty dumb, that sort of thing is one of the more basic concepts.
Then again, some people have no understanding of what is the basic concept of “borrowing money”.

I think most people understand only too well what a triple A credit rating means @Steve at the Pub. It means the interests of creditors and potential creditors are placed squarely before any other claimant on the state. In effect, the state is required to mine its citizens for the benefit of creditors rather than cultivate its citizens to the benefit of the common weal. This is why excessive (in neo-liberal zero government terms) health, education and infrastructure policies can lower the credit rating long before cash becomes an issue. Any Labor government with a triple A rating could be considered by definition to have betrayed the non-propertied class interests of its constituency, and should probably be thrown out.

James Any Labor government with a triple A rating could be considered by definition to have betrayed the non-propertied class interests of its constituency, and should probably be thrown out.

That’s rather hyperbolic.

One could argue that a government that keeps a triple A credit rating is intentionally keeping its borrowing costs as low as possible in order to ensure that future generations aren’t burdened with excessive interest costs. Borrowing to the point where credit ratings are cut and yields that creditors demand on the state’s debt increase is essentially harming future generations to benefit the current one.

“In effect, the state is required to mine its citizens for the benefit of creditors rather than cultivate its citizens to the benefit of the common weal.”

At some point the debt will be repaid, unless you are arguing for the state to borrow with the intention to deliberately default. The question becomes whether it is best to borrow against the future for consumption/investment today.

Now I’m not suggesting that sovereign debt is evil or that a AAA credit rating must necessarily be kept at all times. There could be situations in which borrowing to the point that a AAA rating is lost could be beneficial in the long run, such as if there is a massive infrastructure deficit and the borrowing will be used to invest in this gap (arguably the case today in Australia). Incidentally, you would hope that ratings agencies would be able to recognise the productive nature of such investment and not cut ratings in response but who knows with those institutions.

I guess what I’m trying to say is that claiming that a government who keeps a AAA credit rating is betraying a large proportion of its citizens seems naive and simplistic to me.

the ALP in government has never been real left at all. They have been quite conservative for the times they were in. There is a reason for that. you never win elections being real left.

Go and read at Catallaxy. They are the mirror image of the old real Left. Ignore facts and only remain true to outdated beliefs and only talk to true believers as you might get infected by what is happening in the real world.

It was truly thinking these people wre lving in bizaaro world.

It is quite clear few people here have any idea of what the old real left were like!